FXZ

📎 Investment Objective

The First Trust Materials AlphaDEX Fund (FXZ) seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the NASDAQ AlphaDEX® Materials Sector Index.

✨ Key Features

• Focuses on the materials sector, which includes companies involved in the production of chemicals, metals, and other materials.
• Uses a proprietary stock selection process to identify materials stocks with potential for capital appreciation.
• Diversified portfolio of materials stocks, with no single holding making up more than 5% of the fund.
• Relatively low expense ratio compared to other sector-specific ETFs.

⚠️ Primary Risks

• Sector risk: As a sector-specific fund, FXZ is subject to the volatility and risks associated with the materials industry.
• Stock selection risk: The fund's performance is dependent on the success of the AlphaDEX stock selection methodology.
• Liquidity risk: The fund may have limited trading volume, which could impact the ability to buy or sell shares at desired prices.
• Market risk: The value of the fund's holdings may decline due to general market and economic conditions.

👤 Best For

FXZ may be suitable for investors seeking exposure to the materials sector as part of a diversified portfolio. It may be particularly appealing to investors with a higher risk tolerance who are looking for the potential for capital appreciation through an active stock selection process.